Madden Gulf Coast LLC v. Hilark Industries, Inc.

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF LOUISIANA

MADDEN GULF COAST LLC CIVIL ACTION

VERSUS No. 24-2233

HILARK INDUSTRIES, INC., ET AL. SECTION I

ORDER AND REASONS

Before the Court are two motions for summary judgment filed by the

defendants in this case. The first is a motion1 for partial summary judgment filed by

defendants Hilark Industries, Inc.; Hilbilt Sales Corp.; Hill G3 Industries, Inc.; and

Grayling V. Hill (collectively, the “Hilbilt defendants”). Defendants Hilbilt-Lufkin

Distribution, LLC and Hilark-Lufkin Heavy Haul Trucks & Trailers, LLC

(collectively, “the Lufkin defendants”) joined2 in the Hilbilt defendants’ motion.

Plaintiff Madden Gulf Coast, LLC (“Madden”) filed a response in opposition,3 and the

Hilbilt defendants filed a reply.4

The second motion is the Lufkin defendants’ motion5 for summary judgment.

Madden filed a response6 in opposition, and the Lufkin defendants filed a reply.7 For

1 R. Doc. No. 67.

2 R. Doc. No. 100.

3 R. Doc. No. 79.

4 R. Doc. No. 92.

5 R. Doc. No. 41.

6 R. Doc. No. 78.

7 R. Doc. No. 102.

the reasons that follow, the Court grants both motions in part and denies them in

part.

I. BACKGROUND

This action arises from the alleged wrongful conduct of the Hilbilt and Lufkin

defendants (collectively, “defendants”) “in connection with the engineering, design,

research, testing, manufacture, production, inspection, installation, sale, distribution

and/or warranty of six 19-foot steel dump bodies that [d]efendants manufactured and

installed on six new 2023 Western Star 47X vocational quad axle dump trucks” (“quad

trucks”).8 The Hilbilt defendants are the original sellers and manufacturers of the

dump bodies at issue. The Lufkin defendants have since purchased the assets of the

Hilbilt defendants, leading to a dispute between the parties regarding who is the

proper defendant for each of Madden’s causes of action. Grayling V. Hill (“Mr. Hill”)

was allegedly the owner and president of the Hilbilt entities and became the

president of the Lufkin defendants after the asset purchase.9

Madden’s amended complaint states that, in November 2021, Madden leased

19 new trucks, including 6 quad trucks from Daimler Truck through an agreement

with Daimler Truck and/or Lonestar Freightliner Group, LLC (“Lonestar”).10 Madden

“specified that the six Quad trucks were to be equipped with Hilbilt steel dump

8 R. Doc. No. 106, ¶ 1.

9 Id. ¶ 15.

10 Id. ¶ 20.

bodies,” and “Lonestar made arrangements with Defendant Hilbilt Sales to purchase

six Hilbilt dump bodies for the six new Quad trucks Madden was to lease.”11

After the six quad trucks were delivered to Madden, Madden began to operate

them.12 On September 12, 2023, the amended complaint states that one of the quad

trucks turned over while offloading asphalt.13 And on September 17, 2023, another

quad truck turned over while dumping milling material.14 Madden states that the

two quad trucks that turned over were severely damaged, and an employee who was

driving one of the trucks when it turned over was injured.15 Madden decided to take

the other four quad trucks out of service following the accidents to determine what

had occurred.16

Complicating the question of which party may be liable for the rollover

incidents, the amended complaint states that on September 11, 2023, the day before

the first rollover incident, the Hilbilt defendants and the Lufkin defendants’ parent

company, Saddlebrook Heavy Haul Manufacturing, LLC, entered into an asset

purchase agreement (“APA”).17 The Lufkin defendants later became parties to the

agreement, became “the operating companies of the purchased Hilark and Hilbilt

11 Id. ¶¶ 22–23.

12 Id. ¶¶ 34, 36.

13 Id. ¶ 40.

14 Id. ¶ 43.

15 Id. ¶¶ 50, 53.

16 Id. ¶ 49.

17 Id. ¶ 61.

businesses respectively,” and assumed liabilities owned by the Hilbilt defendants.18

The closing date for the APA was on November 3, 2023.19

Regarding Mr. Hill, the amended complaint alleges that the APA placed Mr.

Hill in multiple roles and conflicting positions that “affected his conduct and

candor.”20 Madden argues that Mr. Hill had a duty to disclose to Madden the fact that

he had sold his businesses to the Lufkin defendants.21 However, Madden alleges that

Mr. Hill did not disclose to Madden that he had sold the businesses “in order to obtain

an unjust advantage for himself.”22

On December 1, 2023—after the rollover incidents—Mr. Hill allegedly

inspected the six quad trucks at Madden’s facility.23 Madden states that Mr. Hill

asked it to send the four undamaged quad trucks to the Lufkin defendants’ facility

where Mr. Hill could perform a better inspection and fix the problems with the dump

bodies.24 Madden delivered the quad trucks to the Lufkin defendants’ facility.25

Yet the amended complaint alleges that Mr. Hill waited until late January

2024 to notify Madden that he would not be fixing the dump beds, stating that his

insurance company told him to do nothing because it could amount to an admission

of fault.26 Madden then told Mr. Hill that it would fix the issues with the dump beds

18 Id. ¶¶ 62–64.

19 Id. ¶ 66.

20 Id. ¶ 76.

21 Id. ¶ 81.

22 Id. ¶ 82.

23 Id. ¶ 78.

24 Id. ¶ 83.

25 Id. ¶ 84.

26 Id. ¶¶ 87, 89.

itself, but it alleges that Mr. Hill asked that he be allowed to keep the dump beds for

a few more weeks to reconsider whether he would fix the dump beds.27 On February

16, 2024, the amended complaint states that Mr. Hill asked Madden to pick up the

four undamaged quad trucks because he was in the middle of selling his business and

did not want to do anything to impact the sale.28 Madden alleges that this statement

was false because Mr. Hill had already sold his business at that point.29

Madden then picked up the four undamaged quad trucks and brought them

back to its own shop, where Madden repaired and modified the dump beds on those

trucks.30 Madden describes how, during this process, it allegedly learned that

defendants had modified the hydraulic dump cylinder mounting arm design on the

dump bodies without making Madden aware of the changes.31 Madden maintains

that many of the welds on the dump bodies were either defective or inadequate.32

Having found these alleged defects, Madden states that it contacted Mr. Hill

regarding its claims to ask that he repair or replace the trucks and dump bodies of

the trucks involved in the rollover incidents.33 Madden contends, however, that

defendants have continued to refuse to act on its claims regarding the two trucks and

dump bodies damaged in the rollover incidents.34 This refusal, Madden alleges, has

27 Id. ¶ 88.

28 Id. ¶ 89.

29 Id.

30 Id. ¶ 98.

31 Id. ¶¶ 100–01.

32 Id. ¶¶ 104–05.

33 Id. ¶¶ 108–09.

34 Id. ¶ 112.

been “in part due to concerns regarding a potential admission of liability with respect

to the possible claims by the driver of the Quad truck involved in the September 12,

2023 rollover accident.”35

Because of the alleged “defective dump bodies, the resulting September 12 and

September 17, 2023 Accidents” and defendants’ failure to either fix or replace the

dump bodies, Madden maintains that that it has sustained multiple categories of

damages.36 Relevant for the present motions, Madden brings claims for violations of

the Louisiana Products Liability Act (“LPLA”), negligence, breach of warranty for

fitness of use, breach of express warranty, and redhibition.37 Madden also brings

personal claims against Mr. Hill and claims for negligence and vicarious liability

against the Lufkin defendants based on Mr. Hill’s actions as an employee.38

The Hilbilt defendants and the Lufkin defendants then filed their respective

motions for summary judgment.39 After defendants filed their motions, the Court

granted Madden leave to amend its complaint.40 Nonetheless, the Court addresses

defendants’ arguments as applied to Madden’s amended complaint.

Both the Hilbilt defendants and the Lufkin defendants argue that Madden’s

claims for negligence should be dismissed because those claims do not arise under the

LPLA, and the LPLA provides the exclusive theory of liability for damages

35 Id. ¶ 112.

36 Id. ¶ 129.

37 Id. at 26, 31, 33–35, 41.

38 Id. at 43, 45.

39 R. Doc. No. 67 (Hilbilt defendants’ motion for summary judgment); R. Doc. No. 41

(Lufkin defendants’ motion for summary judgment).

40 R. Doc. No. 105.

proximately caused by a product.41 Defendants also argue that Madden’s claims for

property damage should be dismissed because Madden does not own the trucks or

dump bodies.42 They maintain that Madden’s claims for damages related to workers’

compensation payments should be dismissed because Madden has not directly paid

any of the workers’ compensation payments.43 Lastly, defendants jointly argue that

all claims against Mr. Hill should be dismissed because he is not a manufacturer

pursuant to the LPLA and because he cannot be held liable individually for his

actions taken related to his duties as president of the companies involved.44

The Lufkin defendants individually argue that they are not manufacturers

pursuant to the LPLA and therefore cannot be held liable for products liability.45

Additionally, the Lufkin defendants argue that they did not assume the Hilbilt

defendants’ liabilities or warranty obligations with respect to Madden through the

APA.46

II. STANDARD OF LAW

Summary judgment is proper when, after reviewing the materials in the

record, a court determines that there is “no genuine dispute as to any material fact

and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). “[A]

party seeking summary judgment always bears the initial responsibility of informing

the district court of the basis for its motion, and identifying those portions of [the

41 R. Doc. No. 67-1, at 4; R. Doc. No. 41-1, at 4.

42 R. Doc. No. 67-1, at 11.

43 Id. at 15.

44 Id. at 7, 9.

45 R. Doc. No. 41, at 2.

46 Id.

record] which it believes demonstrate the absence of a genuine issue of material fact.”

Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The party seeking summary

judgment need not produce evidence negating the existence of a material fact; it need

only point out the absence of evidence supporting the other party’s case. Id.; see also

Fontenot v. Upjohn Co., 780 F.2d 1190, 1195–96 (5th Cir. 1986) (“There is no sound

reason why conclusory allegations should suffice to require a trial when there is no

evidence to support them even if the movant lacks contrary evidence.”).

Once the party seeking summary judgment carries that burden, the

nonmoving party must come forward with specific facts showing that there is a

genuine dispute of material fact for trial. See Matsushita Elec. Indus. v. Zenith Radio

Corp., 475 U.S. 574, 587 (1986). The showing of a genuine dispute is not satisfied by

creating “‘some metaphysical doubt as to the material facts,’ by ‘conclusory

allegations,’ by ‘unsubstantiated assertions,’ or by only a ‘scintilla’ of evidence.” Little

v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994) (citations omitted). Rather, a

genuine dispute of material fact exists when the “evidence is such that a reasonable

jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc.,

477 U.S. 242, 248 (1986). If the nonmovant fails to meet its burden of showing a

genuine issue for trial that could support a judgment in favor of the nonmovant,

summary judgment must be granted. See Little, 37 F.3d at 1075–76.

The party responding to the motion for summary judgment may not rest upon

the pleadings but must identify specific facts that establish a genuine issue.

Anderson, 477 U.S. at 248. The nonmoving party’s evidence, however, “is to be

believed, and all justifiable inferences are to be drawn in [the nonmoving party’s]

favor.” Id. at 255. “Although the substance or content of the evidence submitted to

support or dispute a fact on summary judgment must be admissible . . . the material

may be presented in a form that would not, in itself, be admissible at trial.” JW Dev.,

LLC v. Indep. Specialty Ins. Co., Civ. A. No. 22-390, 2022 WL 3139133, at *1 (E.D.

La. Aug. 5, 2022) (Africk, J.) (quoting Lee v. Offshore Logistical & Transp., LLC, 859

F.3d 353, 355 (5th Cir. 2017)).

III. ANALYSIS

a. Hilbilt and Lufkin Defendants’ Joint Arguments

i. Non-LPLA Claims

The Hilbilt and Lufkin defendants each argue in their motions that all non-

LPLA claims must be dismissed because the LPLA provides the exclusive theories of

liabilities for damages proximately caused by a product.47 In particular, the Hilbilt

defendants argue that “the LPLA does not authorize claims for negligence” and that

“those claims should be dismissed as a matter of law.”48

Madden agrees that the LPLA and redhibition49 law govern its claims for

property damage and personal injuries.50 However, it argues that other causes of

47 R. Doc. No. 67-1, at 4; R. Doc. No. 41-1, at 6–8.

48 R. Doc. No. 67-1, at 4.

49 In Louisiana, redhibition is “the avoidance of a sale on account of some vice or defect

in the thing sold which renders the thing either absolutely useless or its use so

inconvenient and imperfect that it must be supposed that the buyer would not have

purchased it had he known of the vice.” Vitter v. Blaize, 376 So. 3d 193, 196 (La. Ct.

App., 2023); see also La. C.C. art. 2520.

50 R. Doc. No. 79, at 7.

action are available for defendants’ post-rollover conduct.51 Madden argues that the

Hilbilt defendants’ warranty obligated them “to repair and replace issues with dump

bodies or replace them.”52 The Lufkin defendants, Madden argues, assumed warranty

obligations either by the terms of the APA or by the Lufkin defendants’ independent

actions in accepting the trucks for repairs and holding them for several months

without communicating to Madden that its warranty claim was being rejected.53

Madden further alleges that Mr. Hill is liable for his actions in leading Madden

to believe that the four remaining quad trucks would be fixed.54 Madden states that

Mr. Hill “was authorized to receive, accept, administer, and approve warranty claims”

without any formal procedures and that he took possession of the trucks from

December to February without doing any work to repair the trucks.55 Madden

maintains that it relied on representations that the trucks would be repaired and

that it never received any communications that its warranty claim was being

rejected.56 Madden thereby states that its claims regarding this conduct are not

barred by the LPLA.57

The LPLA “establishes the exclusive theories of liability” pursuant to

Louisiana law against manufacturers for damage caused by their products. Pramann

v. Janssen Pharms., Inc., Civ. A. No. 16-12413, 2017 WL 58469, at *2 (E.D. La. Jan.

51 Id. at 8–10; R. Doc. No. 78, at 9, 12–15.

52 R. Doc. No. 79, at 9.

53 R. Doc. No. 78, at 9–15.

54 R. Doc. No. 79, at 9.

55 Id. at 9–10.

56 Id. at 10.

57 Id.

5, 2017) (Africk, J.) (quoting La. Stat. § 9:2800.52 and citing Jefferson v. Lead Indus.

Ass’n, 106 F.3d 1245, 1248 (5th Cir. 1997)). To succeed on a claim pursuant to the

LPLA, a plaintiff must prove four elements:

(1) that the defendant is a manufacturer of the product; (2) that the [plaintiff’s]

damage was proximately caused by a characteristic of the product; (3) that this

characteristic made the product “unreasonably dangerous”; and (4) that the

[plaintiff’s] damage arose from a reasonably anticipated use of the product by

the [plaintiff] or someone else.

Stahl v. Novartis Pharms. Corp., 283 F.3d 254, 260–61 (5th Cir. 2002) (citing La. Stat.

§ 9:2800.54(A)).

A product is unreasonably dangerous pursuant to the LPLA “if and only if” the

product is “unreasonably dangerous either (1) in construction or composition, (2) in

design, (3) because of inadequate warning, or (4) because of nonconformity to an

express warranty.” Rhodes v. Covidien LP, Civ. A. No. 18-10667, 2019 WL 2162845,

at *2 (E.D. La. May 17, 2019) (Vance, J.) (internal citation omitted). “Thus, the LPLA

limits the plaintiff to four theories of recovery: construction or composition defect,

design defect, inadequate warning, and breach of express warranty.” Id. “[F]or causes

of action arising after the effective date of the LPLA, negligence, strict liability, and

breach of express warranty are not available as theories of recovery against a

manufacturer, independent from the LPLA.” Stahl, 283 F.3d at 261.

However, the LPLA only limits the theories of liability for manufacturers with

respect to “damage caused by their products.” La. R.S. § 9:2800.52. The LPLA defines

damage as follows:

Damage means all damage caused by a product, including survival and

wrongful death damages, for which Civil Code Articles 2315, 2315.1 and 2315.2

allow recovery. “Damage” includes damage to the product itself and economic

loss arising from a deficiency in or loss of use of the product only to the extent

that Chapter 9 of Title VII of Book III of the Civil Code, entitled “Redhibition,”

does not allow recovery for such damage or economic loss. Attorney’s fees are

not recoverable under this Chapter.

La. R.S. § 9:2800.53(5).

“While the LPLA governs products liability in tort, it does not preclude

recovery for economic loss arising from breach of warranty or breach of

contract.” McAuslin v. Grinnell Corp., Civ. A. No. 97-775, 2001 WL 8584, at *2 (E.D.

La. Jan. 3, 2001) (Vance, J.). Explicitly not covered by the LPLA, the articles

appearing in Chapter 9 of Title VII of Book III of the Louisiana Civil Code—although

entitled redhibition—cover not only redhibition but also the seller’s obligation to

deliver a thing reasonably fit for its ordinary use, La. C.C. art. 2524, and actions

for breach of contract because the thing delivered is not of the kind or quality

specified in the contract. La. C.C. art. 2529. “[D]amages for breach of contract,

including but not limited to redhibition, are recoverable from a product manufacturer

under these articles of the Civil Code.” C-Innovation, LLC v. Norddeutsche

Seekabelewerke GMBH, Civ. A. No. 10-4441, 2013 WL 990026, at *4 (E.D. La. Mar.

13, 2013) (Morgan, J.). Madden may therefore maintain its claims for breach of

warranty independently from the LPLA to the extent that it relies on a breach-of-

contract theory.

Likewise, Madden’s claims for breach of warranty for fitness of use are not

covered by the LPLA, and Madden may pursue these claims under a breach-of-

contract theory. See La. C.C. art. 2524 (stating that, if an item is not fit for its ordinary

use pursuant to the statute, “the buyers rights are governed by the general rules of

conventional obligations”); see also Cunard Line Ltd. Co. v. Datrex, Inc., 926 So. 2d

109, 113 (La. Ct. App. 2006) (stating that when a buyer files a claim pursuant La.

C.C. art. 2524, that claim “is one for breach of contract and not the action arising from

the warranty against redhibitory defects” (internal citation and quotations omitted)).

Madden’s claims for negligence are not provided for in the LPLA and must be

dismissed to the extent that they sound in tort. However, part of Madden’s amended

complaint alleging negligence states that defendants’ acts in taking possession of the

four quad trucks under representations that they would be repaired, replaced, or

modified and holding the trucks for two months without taking any action was

negligent.58 This portion of Madden’s complaint appears to allege a negligence theory

sounding in contract. “In the case of negligent breach of a contractual obligation,

causes of action lie for both the breach of contract and the negligence.” Robertson v.

Sun Life Fin., 187 So. 3d 473, 479 (La. Ct. App. 2013). Madden may therefore pursue

its claims for negligence to the extent that they rest on a negligent breach-of-contract

theory.

ii. Property Damage Claims

Defendants next argue that Madden cannot bring a claim for property damage

because Madden is the lessee and not the owner of the equipment.59 Defendants also

argue that, pursuant to the lease agreement, the dump bodies that were added to the

leased trucks are owned by the lessors of the equipment because the improvements

58 R. Doc. No. 106, ¶ 162.

59 R. Doc. No. 67-1, at 11–14.

“cannot be readily removed without causing damage to the equipment.”60

Accordingly, defendants argue that Madden also cannot bring a property damage

claim for the dump bodies because it does not own them.61

However, as Madden points out in its response,62 Louisiana law provides that

a lessee is permitted to file an action “to protect the lessee’s possession against a

disturbance caused by a person who does not claim a right in the leased thing.” La.

C.C. art 2702. The Louisiana Supreme Court has clarified that article 2702 (formerly

numbered 2703) affords “the lessee . . . a right of action for damages sustained against

the person occasioning the disturbance.” Potter v. First Fed. Sav. & Loan Ass’n of

Scotlandville, 615 So. 2d 318, 323–24 (La. 1993). Defendants, as nonparties to the

lease, do not argue that they “claim a right in the leased thing.” See La. C.C. art 2702.

Accordingly, Madden’s status as a lessee does not prevent Madden from maintaining

claims for property damage against defendants.

iii. Claims for Workers’ Compensation Obligations

Defendants next ask that this Court dismiss Madden’s claims “for damages

related to the recovery of payments made by Boulder Insurance, LTD related to [the

injured driver’s] workers’ compensation claim.”63 Defendants argue that all of the

driver’s workers’ compensation claims have been paid by Boulder Insurance, LTD

(“Boulder Insurance”), who is not party to this litigation.64 Though defendants state

60 Id. at 14.

61 Id.

62 See R. Doc. No. 79, at 19.

63 R. Doc. No. 67-1, at 15.

64 Id.

that Madden has claimed that it has been assigned the right to collect on the workers’

compensation payments made by Boulder Insurance, defendants argue that Madden

has offered no “additional explanation or evidence regarding this alleged right to

assignment.”65

In its response, Madden argues that the Louisiana Workers’ Compensation

Law (“LWCL”) allows anyone who has paid or becomes obligated to pay workers’

compensation to file a lawsuit against a third-party tortfeasor.66 Because it is

undisputed that Madden was obligated as the injured driver’s employer to pay for

injuries allegedly sustained in the rollover incident, Madden argues that it is

immaterial whether it actually paid the workers’ compensation or whether its insurer

was the one to pay the claim.67 Further, though Madden contends that such

assignment is irrelevant, Madden produces a letter from Gallagher Bassett, its

insurance provider’s workers’ compensation claim administrator, memorializing that

Madden has been assigned the right to pursue this claim.68 Defendants dispute the

letter, stating that there is no evidence that Gallagher Bassett has authority to assign

the right because Boulder Insurance was the one to pay the claim.69

65 Id. at 15–16.

66 R. Doc. No. 79, at 20–21 (citing La. R.S. 23:1101(B)).

67 Id. at 21.

68 Id. at 21–22.

69 R. Doc. No. 92, at 5. Defendants’ reply also argues that Madden’s letter should be

stricken because it was not produced in discovery and is dated after discovery in this

case ended. Id. Because all deadlines are being extended in this matter following

Madden’s amended complaint, see R. Doc. No. 113, the Court declines to strike

Madden’s letter.

As provided for in Louisiana’s workers’ compensation scheme, the award of

compensation to an injured employee “shall not affect the claim or right of action of

the said employee . . . against [third persons legally liable to pay damages to the

employee].” La. R.S. 23:1101(A). To prevent double recovery by an employee,

employers and insurers are entitled to credit for any amounts paid by the third-party

tortfeasor. Following any compromise of the claim between the employee and the

third-party tortfeasor, insurers and employers are entitled to “dollar for dollar credit

against the full amount paid in compromise, less attorney fees and costs paid by the

employee in prosecution of the third party claim.” La. R.S. 23:1102(B). In the event

that an employee recovers damages from the third-party tortfeasor in court, “such

damages shall be so apportioned in the judgment that the claim of the employer for

the compensation actually paid shall take precedence over that of the injured

employee or his dependent.” La. R.S. 23:1103(A).

Employers and workers’ compensation insurers likewise have their own right

of action to recover benefits that they have paid to an injured employee from a third-

party tortfeasor who is responsible for the damage. Houston General Ins. Co. v.

Commercial Union Ins. Co., 649 So. 2d at 781 (La. Ct. App. 1994). In pertinent part,

La. R.S. 23:1101(B) provides:

Any person having paid or having become obligated to pay compensation under

the provisions of this Chapter may bring suit against such third person to

recover any amount which he has paid or becomes obligated to pay as

compensation to such employee or his dependents.

For purposes of the LWCL, insurers are explicitly “subrogated to all rights and

actions which the employer is entitled,” La. R.S. 23:1162(D), providing the insurer

with these same statutory rights to reimbursement against legally liable third

persons. When an insurer recovers compensation paid on the employer’s behalf from

a third-party tortfeasor, “an insurer shall grant its insured a dollar-for-dollar credit

for any amount on any claim paid . . . on the employer’s behalf.” La. R.S. 23:1103(D).

However, compensation insurers are not subrogated to the employee’s rights. Dodson

v. Old Republic Ins. Co., Civ. A. No. 98-3041, 1999 WL 329701, at *3 (E.D. La. May

21, 1999) (Clement, J.).

In order to promote timely intervention and to protect the parties from losing

their rights under the statutory scheme, see Haynes v. United Parcel Service, 933

So.2d 765, 768 (La., 2006), Louisiana Revised Statute 23:1102 sets forth the

obligation of giving notice by an injured employee or the employer or insurer in the

event that one of them files suit against a third-party tortfeasor as authorized by La.

R.S. 23:1101. The statute requires that if the employee, the employer, or the insurer

sues the tortfeasor, he must notify the other parties so that they may intervene as a

party plaintiff in the suit. La. R.S. 23:1102(A)(1).

Failure of an employee to notify his employer or the insurer of the third-party

lawsuit may result in the employee forfeiting his right to future compensation,

including medical benefits. La. R.S. 23:1102(B). Similarly, after proper notice is

received, the failure of an employer or insurer to intervene bars the employer or

insurer from bringing a separate suit against a third-party tortfeasor. Rolls ex rel.

A.R. v. Packaging Corp. of Am., Civ. A. No. 18-188, 2019 WL 13221922, at *2 (W.D.

La. Sept. 24, 2019).

The LWCL therefore sets out a detailed scheme outlining the rights of

employees, employers, and compensation insurers in suits against third-party

tortfeasors. However, the statute does not address whether an employer has a right

to recover compensation benefits paid by its insurer. The statute likewise does not

address any reimbursement rights an insurer may have if its insured—acting on its

insurer’s behalf—recovers compensation benefits paid by the insurer. The Court is

aware of no case addressing the issue. Nor do defendants cite to any authority in

support of their argument that no such right exists.

The Court notes that, generally, a subrogated insurer that “has paid an entire

loss suffered by the insured, it is the only real party in interest and must sue in its

own name.” United States v. Aetna Cas. & Sur. Co., 338 U.S. 366, 390 (1949).

Louisiana law has provided no statutory exception to this general rule. Accordingly,

the Court concludes that a better reading of R.S. 23:1101(B) does not permit an

employer to sue to recover compensation that has been or will be paid by its insurer.

Although the case did not concern whether an employer could recover pursuant

to the LWCL for compensation benefits paid by its insurer, the court in Johnson v.

Qualawash Holdings, L.L.C. considered a compensation insurer’s argument that it

must be permitted to join a lawsuit brought pursuant to the LWCL against a third

party “because, if it were not so permitted, it would be barred from ever recovering

directly from a third-party tortfeasor or the plaintiff.” 990 F. Supp. 2d 629, 638 (W.D.

La. 2014). The court there noted that the insured employer’s inclusion in the lawsuit

was not sufficient to protect the insurer’s interests unless the contract between the

parties had a reimbursement clause. Id. at 639. Because the insurer only had rights

to subrogation and not to reimbursement pursuant to the insurance policy, and

because Louisiana law did not provide the insurer with a right to recover

compensation paid unless it intervened, the court concluded that the insurer was a

required party to the litigation pursuant to Federal Rule of Civil Procedure 19. Id. at

640.

The interests in recovery contemplated by R.S. 23:1101(B) belong to the person

who has paid or will pay compensation. The Court is therefore persuaded that an

employer has no statutory right to sue third parties to recover LWCL compensation

which has been paid by its insurer. Here, Madden has not claimed that it has paid

any LWCL compensation or that it will pay such compensation. Accordingly, Madden

may not bring claims to recover payments made by Boulder Insurance absent some

other assignment of rights.

Madden, however, has provided the Court with a letter from Boulder

Insurance’s claims administrator, memorializing that Madden has been assigned the

right to pursue this claim.70 This is proper summary judgment evidence in support of

its contention that it been assigned Boulder Insurance’s rights to sue to recover

compensation payments made to Madden’s employee. See In re TK Boat Rentals, LLC,

411 F. Supp. 3d 351, 374, 376–77 (E.D. La., 2019) (Ashe, J.) (concluding that an email

exchange between counsel purporting to show an assignment of rights to an insurer

70 See R. Doc. No. 79-22.

was competent summary judgment evidence in support of its argument that it had

been assigned rights to pursue the claims at issue).

Although defendants dispute that there is no evidence that the claims

administrator has authority to assign the right to sue,71 this argument was raised in

a reply brief. The Court therefore declines to grant summary judgment based on this

argument. See Davenport v. Manor, Civ. A. No. 21-224, 2025 WL 542434, at *4 (M.D.

La. Jan. 28, 2025) (citing cases for the proposition that courts need not consider

arguments raised for the first time in a summary judgment reply brief). However, if

Madden cannot produce evidence that the claims administrator had the requisite

authority or that it was otherwise properly assigned Boulder Insurance’s rights,

defendants may reraise their argument at a later date.

iv. Claims Against Grayling V. Hill

As the last of the joint arguments, defendants argue that Mr. Hill cannot be

held liable pursuant to the LPLA because he is not a manufacturer.72 Instead, they

argue, he is merely “acting as President of companies who manufacture and sell

products.”73 Defendants further argue that “there are no circumstances permitting

the piercing of the corporate veil to hold Mr. Hill personally liable in this matter.”74

Madden responds that there are genuine issues of fact regarding whether Mr.

Hill can be held personally responsible because he allegedly designed the dump

71 R. Doc. No. 92, at 5.

72 R. Doc. No. 67-1, at 7.

73 Id. at 8.

74 Id.

bodies and committed fraud.75 Madden states that Mr. Hill “personally made the

defective engineering or design changes to the dump bodies in question and reviewed

and approved the drawings of his modifications” while having “no certifications in

welding or any other field” and while having no engineers on staff or assisting as

consultants.76 The amended complaint details various ways in which Mr. Hill was

allegedly personally negligent in designing and directing the building of the dump

bodies.77 Madden also argues that there is a basis to pierce the corporate veil and

hold Mr. Hill personally liable in this case because he allegedly committed fraud

against Madden and was on both sides of the transaction when negotiating the APA,

attempting to avoid liabilities through the sale.78

The LPLA defines a manufacturer generally as “a person or entity who is in

the business of manufacturing a product for placement into trade or commerce.” La.

R.S. 9:2800.53(1). “‘Manufacturing a product’ means producing, making, fabricating,

constructing, designing, remanufacturing, reconditioning or refurbishing a product.”

Id.

LPLA case law has established that whether a person or entity qualifies under

the general definition of a manufacturer involves a two-pronged inquiry. First, a

manufacturer must be “in the business” of “producing, making, fabricating,

constructing, designing, remanufacturing, reconditioning or refurbishing a product.”

75 R. Doc. No. 79, at 10–11.

76 Id. at 11.

77 Id. at 12–13.

78 Id. at 15–16.

La. R.S. 9:2800.53(1). Second, that individual or entity must place the product “into

trade or commerce.” Id.; see also Singletary v. Crown Zellerbach, 607 So. 2d 804, 809

(La. Ct. App. 1992). For example, in Adelmann-Chester v. Kent, the court concluded

that a doctor who was one of the designers of the product at issue did not place the

product into trade or commerce and could not be considered a manufacturer because

he acted as a consultant, and he never “had control over the fabrication, construction,

and marketing” of the product. 33 So. 3d 187, 199–201 (La. Ct. App., 2009).

Defendants do not cite to any law suggesting that a person who otherwise acts

as a manufacturer within the meaning of the LPLA is shielded from liability when

they act as an employee. However, the Fifth Circuit in Reeves v. AcroMed Corp.,

suggested that the capacity in which an individual acts matters with respect to

whether an individual meets the trade or commerce requirement. 103 F.3d 442 (5th

Cir. 1997). In that case, the Fifth Circuit applying Louisiana law reversed the district

court judgment holding Dr. Steffee liable as a manufacturer pursuant to the LPLA.

Id. at 449. Although Dr. Steffee invented the product and acted in a leadership

position as chairman of the board for the manufacturing company, the Fifth Circuit

concluded that “he, in his capacity of an individual person, did not place the medical

device on the market, introduce it into the stream of commerce, or act as a

professional vendor of the product.” Id. (emphasis added).

The same reasoning applies to Mr. Hill. Although Madden alleges that Mr. Hill

designed the dump bodies and that Mr. Hill had a level of control as president of the

Hilbilt defendants, Mr. Hill did not place the dump bodies into the stream of

commerce in his individual capacity. Instead, he did so in his capacity as president of

the Hilbilt defendants. Mr. Hill is therefore not a manufacturer within the meaning

of the LPLA.

However, Madden alleges that there is a basis for piercing the corporate veil

and holding Mr. Hill individually liable for the defendant companies’ actions.

Madden’s amended complaint alleges that Mr. Hill is liable for “the intentionally

fraudulent misrepresentations he made to Madden, which were designed to mislead

or deceive Madden in order to obtain an unjust advantage,” such as by failing to

disclose his status as president of the Lufkin defendants.79 Madden accuses Mr. Hill

of an “intentional and deceitful failure to handle Madden’s warranty claims in a

professional or businesslike manner.”80 Madden also alleges that Mr. Hill “had full

authority and autonomy . . . to accept or deny warranty claims on behalf of

[d]efendants.”81

Madden’s response to the Hilbilt defendants’ motion for summary judgment

further states that Mr. Hill knew about the rollover incident and was on both sides

of the transaction for the APA, in which he went forward with an asset purchase with

provisions “attempting to exclude liabilities . . . while transferring all assets to the

Lufkin [d]efendants” and preventing the Hilbilt defendants from operating or using

their name.82 Madden states that this asset purchase left the Hilbilt defendants as

79 R. Doc. No. 106, ¶¶ 221–25.

80 Id. ¶ 229.

81 Id. ¶¶ 96–97.

82 R. Doc. No. 79, at 15–16.

shell companies and shifted liability to the “shell” Hilbilt defendants.83 All the while,

Madden states that Mr. Hill misrepresented the status of the sale and of insurance

claims while Madden was awaiting repair of the trucks.84 Madden alleges that these

falsehoods were an attempt to escape liability.85

In Louisiana, “a corporation is a distinct legal entity, separate from the

individuals who compose it, thus insulating the shareholders from personal liability.”

Brennan’s Inc. v. Colbert, 85 So. 3d 787, 791 (La. Ct. App., 2012). In limited

circumstances, however, “the court may ignore the corporate fiction and find the

shareholders personally liable for the debts of a corporation.” Id. Traditional veil-

piercing doctrines are generally limited to cases where the separate existence of the

corporation has been abused . . . .” In re Gulf Fleet Holdings, Inc., 491 B.R. 747, 785

(Bankr. W.D. La. 2013).

One such exception to the corporate fiction is “where the shareholders

disregard the corporate formalities to the extent that the corporation and the

shareholders are no longer distinct entities.” Brennan’s Inc., 85 So. 3d at 791. Another

is where “the corporation is found to be the ‘alter ego’ of the shareholder,” usually

including a practice of fraud and deceit by shareholders. Id. In applying the alter ego

doctrine, courts consider factors such as “(1) commingling of corporate or shareholder

funds; (2) failure to follow statutory formalities for incorporating and transacting

corporate affairs; (3) undercapitalization; (4) failure to provide separate bank

83 Id. at 16.

84 Id.

85 Id.

accounts and bookkeeping records; and (5) failure to hold regular shareholder and

director meetings.” Hill Int’l, Inc. v. JTS Realty Corp., 370 So. 3d 16, 20 (La. Ct. App.,

2022).

As the Hilbilt defendants point out,86 Madden’s allegations of fraud by Mr. Hill

do not appear in the original complaint. Instead, they appear in the amended

complaint, which was filed after defendants filed this motion for summary

judgment.87 Accordingly, there are now factual disputes regarding whether there is

a basis to hold Mr. Hill liable in his individual capacity for the actions of the

defendant companies. The parties have not briefed whether these new factual

allegations are legally sufficient to pierce the corporate veil, instead pointing only to

a lack of evidence. Because the Court has recently extended the discovery deadlines

in this case to allow time for the parties to address Madden’s new claims, including

its claims of fraud against Mr. Hill, the Court concludes that it is premature to

dismiss Madden’s claims against Mr. Hill.

b. Lufkin Defendants’ Arguments

i. APA-Assumed Liabilities

The Lufkin defendants argue that because the Hilbilt defendants are the

designers, manufacturers, and sellers of the dump bodies, Madden’s redhibition

claims and claims pursuant to the LPLA exist only against the Hilbilt defendants.88

The Lufkin defendants point to a Texas choice-of-law provision in the APA and

86 See R. Doc. No. 92, at 3–4.

87 R. Doc. No. 106.

88 R. Doc. No. 41-1, at 8–9.

contend that Texas law does not allow a buyer to assume a seller’s liabilities unless

the buyer does so expressly.89 Because there is no provision in the APA under which

the Lufkin defendants explicitly assume the Hilbilt defendants’ liabilities, the Lufkin

defendants argue that they cannot be liable pursuant to the LPLA or for redhibition.90

Regarding Madden’s warranty claims, the Lufkin defendants assert that those

claims lie against the Hilbilt defendants and that the Lufkin defendants have only

agreed to assume warranty obligations for products that were sold before closing but

where the claims were presented after closing—conditions that do not apply to

Madden.91 Further, even if the timing of Madden’s warranty claims were not excluded

from the Lufkin defendants’ assumed liabilities, they argue that other limitations in

the original warranty nonetheless exclude Madden’s claims.92

Madden’s response argues that Texas law does not apply to claims made by a

third party who is not subject to the terms of the APA and that Louisiana law applies

to its claims.93 Furthermore, Madden argues that there are issues of fact regarding

whether, regardless of the terms of the APA, Madden can prevail against the Lufkin

defendants as apparent manufacturers pursuant to the LPLA.94 Madden likewise

argues that the Lufkin defendants can be held liable under a theory of successor

liability, citing to Louisiana law in support.95

89 Id. at 10.

90 Id. at 12–13.

91 Id. at 14.

92 Id. at 15–16.

93 R. Doc. No. 78, at 5, 9.

94 Id. at 19.

95 Id. at 21–22.

Regarding the argument that the Lufkin defendants did not assume warranty

obligations that were asserted prior to the closing date, Madden asserts that this

argument is unsupported by the text of the APA and that in assuming “warranty

obligations incurred . . . prior to the Closing Date,” the Lufkin defendants have

assumed warranty obligations for Madden because the products at issue were sold

prior to closing.96 Moreover, even if the assumed warranties in the APA do not apply

to Madden’s claims, Madden argues that either the Lufkin defendants “assumed

Madden’s warranty claims by the superseding acts of their President,” Mr. Hill or

they created a new contractual obligation through those same actions.97

Pursuant to Louisiana law, contractual choice-of-law provisions are presumed

valid, unless the chosen law “contravenes the public policy” of the state whose law

would otherwise apply. See La. C.C. art. 3540; see also Barnett v. Am. Const. Hoist,

Inc., 91 So. 3d 345, 349 (La. Ct. App. 2012) (“A choice of law provision in a contract is

presumed valid until it is proved invalid.”). Here, Madden does not argue that the

Texas choice-of-law provision is invalid. Instead, Madden argues that the choice-of-

law provision is inapplicable to Madden because it is not a party to the contract. The

Lufkin defendants concede that the choice-of-law provision does not apply to Madden

to the extent that Madden makes claims concerning the Lufkin defendants’ direct

liabilities.98 However, the Lufkin defendants maintain that the extent to which they

96 Id. at 11–12.

97 Id. at 12, 15.

98 R. Doc. No. 102, at 1–2.

contractually assumed the liabilities of the Hilbilt defendants is determined by the

APA.99

The Court agrees. Though the APA has no bearing on the Lufkin defendants’

independent liabilities, the APA determines the extent to which the Lufkin

defendants have assumed the Hilbilt defendants’ liabilities. Courts routinely apply

the parties’ choice of law to determine the extent to which such liabilities are

contractually assumed or created. See, e.g., Urda v. Valmont Indus. Inc., 561 F. Supp.

3d 640, 652–53 (M.D. La. 2021) (interpreting an indemnity agreement in accordance

with the laws of Washington when the agreement contained a Washington choice-of-

law provision).

With the applicable choice of law established, the Court now turns to the

question of successor liability. Madden argues that the Lufkin defendants can be held

liable as the Hilbilt defendants’ successors because there are issues of fact with

respect to whether the Lufkin defendants are a mere continuation of the Hilbilt

defendants and whether the APA was entered into fraudulently to escape liability.100

Some jurisdictions, including Louisiana, allow for successor liability where the

purchaser is merely a continuation of the selling corporation or where the transaction

is an attempt to escape liability. See Golden State Bottling Co. v. N.L.R.B., 414 U.S.

168, 182 n.5 (1973) (setting out the general rule of corporate successor liability);

Monroe v. McDaniel, 207 So. 3d 1172, 1180 (La. Ct. App. 2016) (stating that the

99 Id. at 2.

100 R. Doc. No. 78, at 21–23.

Golden State Bottling Co. “principle of successor liability has been followed by

Louisiana Courts”). This Court, however, has established that Texas law governs the

extent to which the Lufkin defendants assumed liabilities through the APA.

“Texas law does not generally recognize successor liability for subsequent

purchases of corporate assets” unless the successor corporation expressly assumes

the liabilities of the predecessor corporation. UST-Mamiya, Inc. v. True Sports, Inc.,

441 F. Supp. 3d 382 (N.D. Tex. 2020) (quoting Renfro v. HCR Pool III Funding Corp.,

Civ. A. No. 05-2231, 2006 WL 8437652, at *1 (N.D. Tex. Aug. 28, 2006)). Indeed, Texas

law has rejected all but the express assumption exception through statute,

establishing that “[e]xcept as otherwise expressly provided by another statute, a

person acquiring property described by this section may not be held responsible or

liable for a liability or obligation of the transferring domestic entity that is not

expressly assumed by the person.” Tex. Bus. Orgs. Code § 10.254(b).

Through the language of this statute, Texas courts have reasoned that mere

continuation and fraudulent transfer in attempt to escape liability are not grounds

for successor liability. See, e.g., Shapolsky v. Brewton, 56 S.W.3d 120, 137–39 (Tex.

Ct. App. 2001). “Thus, only express assumption is grounds for successor liability

under Texas law.” In re 1701 Com., LLC, 511 B.R. 812, 824 (Bankr. N.D. Tex. 2014).

Accordingly, the Lufkin defendants are not successors in liability for the Hilbilt

defendants except to the extent that they expressly assumed those liabilities.

Section 2.04 of the APA, provides that the purchaser agreed to assume certain

listed liabilities.101 These include liabilities arising under assigned contracts and jobs

in progress as well as amounts payable for inventory that had been ordered by the

seller.102 Most relevant here, the Lufkin defendants agreed pursuant to subsection b

to assume the “warranty obligations incurred in the Ordinary Course of Business

pursuant to Sellers’ standard terms relating to goods sold or leased, or services

performed, by Sellers prior to the Closing Date . . . .”103 While the Lufkin defendants

also agreed to assume “those liabilities and obligations of Sellers relating to the

Purchased Assets or the Business and set forth in Section 2.04(d) of the Disclosure

Schedules,”104 that section states only “None.”105

Accordingly, the only liabilities related to this case that the Lufkin defendants

may have arguably assumed from the Hilbilt defendants through the APA are its

warranty obligations. With respect to these potential warranty claims, the Lufkin

defendants argue that the language of the APA establishes that they agreed only to

assume “warranty obligations for products sold before the Closing for product-

warranty claims asserted after the Closing date.”106 Because the rollover events

occurred in September 2023 and Madden’s claims were presented to the Hilbilt

101 R. Doc. No. 41-4, at 5.

102 Id. at 5–6.

103 Id.

104 Id. at 6.

105 Id. at 82.

106 R. Doc. No. 41-1, at 14.

defendants before the November 3, 2023 closing date, the Lufkin defendants argue

that it did not assume liabilities for Madden’s claims.107

Madden disputes the Lufkin defendants’ reading requiring that a claim be

asserted before the closing date for the Lufkin defendants to have assumed warranty

obligations.108 In particular, it argues that the language of the APA includes no

language regarding when a claim or obligation must be asserted.109 Instead, Madden

argues that the Lufkin defendants assumed all warranty obligations pursuant to

goods that were sold or leased prior to the closing date, regardless of when the claim

was presented.110

In interpreting the APA, Texas contract interpretation law dictates that “[i]f

[a contract] is worded so that it can be given a definite or certain legal meaning, it is

not ambiguous and [the court will] construe it as a matter of law.” Am. Mfrs. Mut.

Ins. Co. v. Schaefer, 124 S.W.3d 154, 157 (Tex. 2003). “Whether a contract is

ambiguous is itself a question of law.” Id. The fact that the parties offer different

contract interpretations does not create an ambiguity. See id. “An ambiguity exists

only if the contract language is susceptible to two or more reasonable

interpretations.” Tex. Indus., Inc. v. Factory Mut. Ins. Co., 486 F.3d 844, 846 (5th Cir.

2007).

107 Id.

108 R. Doc. No. 78, at 1–12.

109 Id.

110 Id.

The Court concludes that Madden’s reading of section 2.04 of the APA is the

correct reading. The section of the APA regarding the assumption of warranty

obligations contains no language concerning when a claim is asserted. Instead, it only

contains language concerning obligations “incurred” prior to the closing date.

Importantly, warranty obligations are created when the warranty is made, not when

a claim is asserted. See, e.g., Ford Motor Co. v. Miles, 967 S.W.2d 377, 381 (Tex. 1998)

(describing a sales contract as “creat[ing] warranty obligations”). Accordingly, the

Court cannot conclude that the Lufkin defendants’ reading is a reasonable one.

However, the Lufkin defendants also argue that even if it assumed warranty

obligations for claims presented before the closing date, it nonetheless has no

warranty obligations with respect to Madden.111 In particular, the Lufkin defendants

argue that Madden’s claims do not qualify for the Hilbilt defendants’ limited

warranty because that warranty only extends to original owners.112 In response,

Madden argues that the term “original owner” in the warranty was intended to apply

to the end user of the product, which it argues applies to Madden.113 Madden further

argues that even if the express warranty does not apply to its claims, the behavior of

the parties sufficiently superseded the limits of the express warranty rules such that

the defendants may be held liable for warranty obligations.114

111 R. Doc. No. 41-1, at 15.

112 Id. at 15–16.

113 R. Doc. No. 78, at 10–11.

114 Id. at 13.

While the parties make substantial arguments regarding the interpretation of

the Hilark manufacturer warranty, the Lufkin defendants have not provided briefing

with respect to the choice of law that applies to the manufacturer warranty. Instead,

the Lufkin defendants seem to assume that Texas law also applies because the

manufacturer’s warranty appears as an attachment to the APA. However, the Court

notes that this document appears in the APA’s disclosure schedule as a separate

agreement between the original manufacturer and its customers. The Court therefore

has no basis to conclude that the Texas choice-of-law provision necessarily applies to

the manufacturer’s warranty.

Without a determination regarding what choice of law applies to the

manufacturer’s warranty, the Court cannot apply the proper rules of contractual

interpretation. Nor can the Court assess any arguments regarding when warranty

obligations may be properly waived or whether the behavior of the parties can

supersede limits on an express warranty. The Lufkin defendants have therefore failed

to establish, at this time, that they are entitled to summary judgment with respect to

Madden’s breach-of-warranty claims.

ii. Independent Liability

Notwithstanding the Court’s determination that the Lufkin defendants did not

assume the Hilbilt defendants’ LPLA and redhibition liabilities through the APA,

that determination does not end the inquiry regarding whether the Lufkin

defendants can be held liable for Madden’s claims. In particular, Madden argues that

the Lufkin defendants can be held liable pursuant to the LPLA and for redhibition as

apparent manufacturers.115

The LPLA’s definition of manufacturer is not limited to those who actually

manufacture a product. Instead, a manufacturer includes one “who labels a product

as his own or who otherwise holds himself out to be the manufacturer of the product.”

La. R.S. § 9:2800.53(1)(a). Known as the apparent manufacturer doctrine, the LPLA’s

broad definition of manufacturer “allows a plaintiff to hold a seller or distributor

liable for injuries caused by a product defect, when the seller leads a reasonable

consumer to believe that it is the manufacturer of the product.” Martin v. Pham Le

Brothers, LLC, 330 So.3d 346, 352 (La. Ct. App. 2021). Claims for redhibition can

likewise be brought against apparent manufacturers, Vita v. Rooms to Go La. Corp.,

No. CIV. A. 13-6208, 2014 WL 6835913, at *5 (E.D. La. Dec. 3, 2014) (Barbier, J.), as

well as “all sellers in the chain of sales back to the primary manufacturer.” Lovell v.

Blazer Boats Inc., 104 So.3d 549, 553 & n.3 (La. Ct. App. 2012).

Whether an individual or entity has held themselves out as the manufacturer

of a product is determined “by considering the viewpoint of the purchasing public and

in light of the circumstances as of the time of purchase.” Id. “Ultimately, the rationale

behind the apparent manufacturer doctrine ‘considers the perspective of the

purchaser and his reliance placed upon the labeler of the product in many situations

where the identity of the product’s manufacturer is unclear in the sale of the

product.’” Pablovich v. Rooms to Go La. Corp., Civ. A. No. 20-617, 2021 WL 1401759

115 Id. at 19–21.

(E.D. La. Apr. 14, 2021) (Fallon, J.) (quoting Allstate Ins. Co. v. Fred’s, Inc., 33 So.3d

976, 985 (La. Ct. App. 2010)). Applying this rationale in Martin v. Pham Le Brothers,

LLC, the court concluded that a wholesaler was not an apparent manufacturer where

it placed its initials on a photo of the product appearing in a catalog that it provided

to customers. Martin, 330 So.3d at 352–53. In particular, the Court noted that there

was no evidence that the plaintiff saw the catalog before purchasing the product. Id.

at 353.

Madden argues that the apparent manufacturer doctrine applies to the Lufkin

defendants because they allegedly “stepped into the businesses of the Hilbilt

Defendants” and “continued to make and sell the same products, employ the same

workers, were located in the same facilities, manufactured, installed and sold Hilbilt

Dump bodies in the same way, used the same logos, and had the same distributors.”116

Madden points to Pellecer v. Werner Co., No. 2023-CA-0694, 2024 WL 4500968 (La.

Ct. App. Oct. 16, 2024), a case in which the defendant company that purchased

certain assets of a ladder manufacturer through bankruptcy proceedings was held

liable as an apparent manufacturer. The court there concluded that the defendant

could still be liable as an apparent manufacturer despite the fact that the purchasing

company did not exist when the ladder at issue was manufactured. Id. at *9–10. In

that case, the purchasing company held the ladder out as its own through, for

example, continuing to use the brand and logo of the manufacturing company. Id.

116 R. Doc. No. 106, ¶ 217.

However, the holding of Pellecer relies on the fact that the plaintiff in that case

continually argued that the ladder could have been purchased after June 2007—when

the purchasing company acquired the assets of the manufacturing company in

bankruptcy. Id. at *10. Based on the evidence, the court concluded that the apparent

manufacturer doctrine applied because “the jury determined that by a preponderance

of the evidence the [purchasing company] labeled the ladder as its own or held the

ladder out as its own at the time [the plaintiff’s husband] bought the ladder.” Id. at

*20 (emphasis added) (internal quotations omitted).

Here, all of Madden’s arguments for why the apparent manufacturer doctrine

applies to the Lufkin defendants concern actions allegedly taken after executing the

APA in 2023. Madden states in its amended complaint that it entered its agreement

to lease the trucks in this case in 2021.117 Madden therefore does not allege that the

Lufkin defendants held themselves out as manufacturers of the dump bodies at the

time that the dump bodies were purchased. Accordingly, Madden’s claims against the

Lufkin defendants for violations of the LPLA and for redhibition must be dismissed.

IV. CONCLUSION

For the foregoing reasons,

IT IS ORDERED that the Hilbilt defendants’ motion for summary judgment

is GRANTED IN PART AND DENIED IN PART. The motion is GRANTED to the

extent that Madden’s claims for negligence sounding in tort law are DISMISSED

117 Id. ¶ 20.

WITH PREJUDICE against all defendants. The motion is DENIED in all other

respects.

IT IS FURTHER ORDERED that the Lufkin defendants’ motion for

summary judgment is GRANTED IN PART AND DENIED IN PART. The motion

is GRANTED to the extent that Madden’s claims against the Lufkin defendants for

negligence sounding in tort, violations of the LPLA, and redhibition are DISMISSED

WITH PREJUDICE. The motion is DENIED with respect to Madden’s claims based

in warranty and breach of contract.

New Orleans, Louisiana, May 23, 2025.

AnA___

Safe

UNITED SKATES DISTRICT JUDGE

37